The story of HOPE in Moorhead illustrates the importance of access to ﬁnancial services at both the individual and community levels.
With a population of about 2,000, the town of Moorhead in the Mississippi Delta is 88% African-American, has a 49% poverty rate, and Regions Bank was its only ﬁnancial institution. The branch was also located in Sunﬂower County, where more than 40% of households were unbanked or underbanked—well above the national average.
The local bank was a critical resource for the community—but the bank’s business model did not allow it to oﬀer a full range of ﬁnancial products and services in the communities its branches served. Regions Bank saw an opportunity to meet the ﬁnancial needs of the community while also fulﬁlling its obligations through the Community Reinvestment Act (CRA). The CRA is a federal law that requires banks of certain sizes to provide loans and ﬁnancial services in low- and moderate-income communities in which the bank has a physical presence. They can meet this requirement in diﬀerent ways, including by investing in CDFIs, which are ﬁnancial institutions whose mission is to create opportunity and promote economic growth in communities that have been underinvested.
By leveraging the CRA, HOPE and Regions Bank craﬅed a partnership. Regions Bank donated its branch facility to the credit union, provided access to customers prior to the branch closure, and provided startup capital for branch operations. Shortly aﬅer HOPE took control of the building, one resident shared that he walked miles to the branch to apply for a loan to ﬁx his truck. Without his truck, he wouldn’t have been able to maintain his livelihood. HOPE was able to help with these smaller loans that can be critical for helping people to make their way out of poverty and stay on their feet.
The bank branch also provided an anchor in the community for HOPE to engage more deeply in broader community transformation work through HOPE’s Small Town Partnership. Through the Small Town Partnership, HOPE empowers and works alongside local people to lead change eﬀorts in their communities. In Moorhead, residents identiﬁed high quality aﬀordable housing, recreational activities for children, getting rid of blighted buildings, and saving a school as top priorities.
With the Small Towns Partnership underway, momentum continued with the securing of resources to rebuild the neighborhood of Eastmoor, located on the outskirts of Moorhead. This community was built in the 1970’s to reduce the number of black residents living in Moorhead to maintain a white voting bloc and elect a white mayor there, creating a legacy of segregation and disinvestment in Eastmoor. A number of the homes in the development have since burned down due to faulty construction, and of the homes that remained standing, many were in complete disrepair with collapsed ceilings and cracked foundations. Through the eﬀort to rebuild the homes, HOPE and its partners created a program to train local residents in the construction trades, with support from national funders, so residents would beneﬁt from the new job opportunities being created as well. Back in town, new ball ﬁelds have been constructed and a local school previously slated for closure has a new life as an early education hub for the county. Additional funds matched a Department of Transportation grant to light the road from the highway into town.
The presence of a ﬁnancial institution that meets people where they are in life signals opportunity for residents to improve their own ﬁnancial circumstances, and also provides avenues for local economies to grow and thrive. When there’s no such ﬁnancial institution in town or nearby, these opportunities are too oﬅen limited. Policy plays a big role in catalyzing investment in places with generational poverty: CRA regulations motivated Regions Bank to ﬁnd a solution to exiting a rural community; federal investments incentivized the transfer of the branch; and federal support for community planning helped attract and leverage private capital for projects that were prioritized by the people who lived there. HOPE’s role as a regional CDFI was important not just in connecting to and knitting together various forms of investment in a way that ﬁt local needs and advanced local progress, but also in deeply understanding local historical and cultural contexts. HOPE brought its long-term relationships and trust from the local community together with national stakeholders and resources to have a greater impact, driven by the people who know best what their community needs. This has played out not just in Moorhead, but in towns across the region.